Medicare Advantage Prescription Drug (MA-PD) Plans
The Medicare prescription drug plan program, also referred to as Medicare Part D, became effective January 1, 2006. Most Medicare Advantage plans available in Wisconsin include prescription drug plan coverage and are referred to as Medicare Advantage prescription drug (MA-PD) plans. MA-PD plans are subject to the same requirements as stand-alone prescription drug plans (PDPs).
Cost of Medicare Advantage Prescription Drug (MA-PD) Plan Coverage
In most circumstances, you will pay a premium for the prescription drug coverage under a Medicare Advantage plan. In addition to monthly premiums, you will pay an annual deductible which is $295 in 2009, plus copayments for each of your prescription drugs. You will pay 100% of the cost of covered drugs between $2,700 and $6,153.75 in 2009, called a coverage gap. The amount of your monthly out-of-pocket expenses will depend on how many prescriptions you need. After you have spent $4,350 in out-of-pocket costs in 2009, you will have to pay only 5% of the cost of covered prescriptions for the rest of the year. (Centers for Medicare and Medicaid Services)
The Health Insurance Portability and Accountability Act of 1996 (HIPAA) requires that health insurance issuers, group health plans and/or employers issue a HIPAA certificate of creditable coverage when your health coverage ends. The certificate indicates the date on which your coverage ends and how long you had the coverage. You should retain this document for your records because the certificate provides evidence of your prior coverage. If certain conditions are met, evidence of prior coverage may entitle you to a reduction or total elimination of a preexisting condition exclusion period under a subsequent health insurance policy you purchase.
The Medicare Modernization Act (MMA) imposes a late enrollment penalty on individuals who do not maintain creditable drug coverage (coverage that is at least as good as Part D coverage) for a period of 63 days or longer following their initial enrollment period for the Medicare prescription drug benefit. MMA mandates that health plans offering prescription drug coverage disclose to all Medicare eligible individuals with prescription drug coverage whether such coverage is creditable. Individuals should retain this document for their records. For more information on creditable coverage as it relates to Part D, go to www.cms.hhs.gov/CreditableCoverage/01_Overview.asp.